The Securities and Exchange Commission has charged 11 people for their role in what the agency is calling a “fraudulent crypto pyramid and Ponzi scheme.”
According to an SEC, Forces allegedly raised more than $300 million illegally from retail investors in countries around the world, including the United States. Statement Released on Monday. The agency accused the organization’s four founders and several others of promoting the nine-figure plan.
“Fraudsters cannot circumvent federal securities laws by focusing their plans on smart contracts and blockchains,” said Carolyn Welshhans, acting head of the SEC’s Crypto Assets and Cyber Unit.
According to a 2020 SEC criminal complaint, the founders based in Russia, the Republic of Georgia and Indonesia created Forsage, a website that allowed millions of retail investors to transact via smart contracts using the Ethereum, Tron and Binance blockchains.
Users of Forsage earned returns by recruiting others to join the alleged scheme, which ran for more than two years. Additionally, Forsage allegedly used funds from new investors to pay off earlier investors, which the SEC said is typical of Ponzi schemes.
The cease-fire action was followed by regulators in the Philippines and the Montana Commissioner of Securities and Insurance, which liaised with the forces in March last year. According to the SEC, the individuals accused in the case continued to promote the scheme, and denied the allegations in several YouTube videos.
a youtube Channel What claims to be official for Forces has garnered nearly 170,000 views and about 6,500 subscribers. It includes videos – about a minute long – of people talking about how their lives have been made better by Forsage.
At the same time, Forsage’s website claims to have brought in over 2 million participants. It says about 2,500 people have joined Forsage in the past day and members have been rewarded with more than $1.35 billion worth, presumably since the website launched.
While the founders of Forsage are based outside the US, the SEC has accused Americans living in Illinois, Mississippi, Kentucky and Florida of allegedly helping promote the plan.